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Haslam to give 4th State of State speech tonight

NASHVILLE (AP) - Republican Gov. Bill Haslam said Monday that he's making it a priority to fund key education initiatives and care for the state's most vulnerable citizens despite a tight budget year.

Haslam was to unveil details of his annual state spending proposal and lay out some of his top legislative priorities for the year during his State of the State address Monday evening.

Earlier in the day, he met with reporters and reiterated what state financial officials have been reporting over the past several months, that revenue collections have failed to meet projections.

He noted the state has $260 million in new revenue for the budget year beginning in July. However, $180 million will go toward costs to TennCare - the state's expanded Medicaid program - and $120 million is proposed for education.

He also said health insurance costs for state workers are up $40 million.

"So, before putting anything toward anything else , we already have an $80 million deficit," which will require the state to make some cuts, he said.

Haslam had warned that a large part of TennCare's budget would be used to care for the thousands of people identified by the federal health care law's online exchanges as eligible for TennCare but not enrolled.

Officials had projected that the exchanges would identify nearly 47,000 people who fall into that group.

However, TennCare Director Darin Gordon told Gov. Bill Haslam during a budget hearing in November that the figure will more likely be about 52,000 for fiscal year 2015.

Gordon said that was concerning, "but at this point, we don't have anything to cause us to revise our numbers."

As for education, Haslam stressed the importance of Tennessean's earning a degree from a community college or university, which is why he's putting more money toward his so-called "Drive to 55" initiative.

Its goal is to improve Tennessee's graduate rates f rom colleges and universities from the current 32 percent to 55 percent by 2025.

"This isn't just about higher education; it's about better jobs for more Tennesseans and building a stronger economy," he said.

The governor plans to also put money into the state's school funding formula. Critics say the current Basic Education Program does not adequately fund districts statewide.

"When other states sacrificed education spending during tight budgets, we haven't," said Haslam, who has appointed a task force to study the formula. "Tennessee is one of only six states in the country that has consistently increased state funding on K-12 education as a percentage of our total budget over the past three years."

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